A comparative study of capital structure of banks in India

Abstract

The Indian economy is emerging as a one of the strongest economy of the world with an average growth rate of approximately 7% over the last two decades, in which the bank played a vital role. A strong banking industry is important in every country and can have a significant effect in supporting economic development through efficient financial services. After liberalization, the banking industry in India had undergone major changes. The process of liberalization and globalization has strongly influenced the Indian banking sector. Liberalization policy introduced in the banking sector in India led to consolidated competition, efficient allocation of resources and introducing innovative methods for mobilizing of saving. The ability of banks to analyses its financial position for improving its competitive position in the market place. It is well known fact that an effective and efficient banking system is important for the long-run growth and development of the economy. So, there is need to make a comprehensive study of the performance of banks in India. newlineThe Government has taken this sector on a basic priority and this service sector has been changed according to the need of present days. Different type of banks differs from each other in terms of operations, efficiency, productivity, profitability and credit efficiency. Indian banking sector is an important constituent of the Indian Financial System. The banking sector plays a vital role through promoting business in urban as well as rural area in recent year, without a sound and effective banking system, India cannot be considered as a healthy economy. newline